GovernmentExecutive.com

Return to Article: OPM calls for end to pension penalty for rehired retirees

• 83746
  

  When the BRAC Comission closed Long Beach Naval Shipyard in 1996, I took a voluntary seperation, and retired with 26 years of service. Because I was under 55, my retirement was penalized almost 20%. With the incentives offered to private industry, Iwas able to secure a job and they paid to move me to my new location (over 1,000 miles away). I have worked in private industry for 13 years and honed my considerable skills, added new ones and modified my "government mentality". I applied to the Army Corps of Engineers in Portland for a position on their dredge ship, was accepted and told to apply for my TWIC and Merchant Marine Documents so I could get on board in Feb. when the ship was expected to leave the shipyard. I could not start until all documents were in hand. March 12 I received my final document and informed the corps. During the conversation I was informed that I would need to fill out a new hire form and when I told them I was retired they stopped all conversation and said they would get back to me. ACE Personnel informed me April 4 that my application had been recinded because I was a rehired annuitant. The Corps has needed a person in that position for two years and I had 26 years of marine electrical experiance with 13 years of drives and electronic experiance. I am planning on working for another 10 years and am physically able to do so. Why am I penalized?

  Merle Pence Posted July 29, 2009 3:09 PM
• 63087
  

  I wrote Rep. Davis, the co-sponsors, and their committees after encountering and researching 9902j last year; perhaps someone kept my letters. I'm a former DOD employee and disability annuitant who cannot work full-time, but could and has worked his way off permanent Social Security eligibility. Sure, I now make more money as a P/T contractor, but the uncertainty of when they will go out of business, lose a contract, lay me off because of schedule slips, etc. is enormous. Clearly civil service employment, even with offset for former Feds, is the best option for the disabled. However, I cannot return to the employer I gave ten years to, because 9902j got slipped into Public Law as the NSPS retirement system was being pushed. The services - at least some in the Army - have contested the hiring hindrance for years, but were heretofore ignored. Irrespective of NSPS, 9902j should be sticken from the U.S. Code. And BTW, those afraid of "big government" would gain a fresh perspective if they could see how DOD, NASA, Social Security, the Treasury, etc. can barely function by doing "more with less."

  Chris in VA Posted November 16, 2008 4:08 PM
• 51680
  

  In response to Mr. Roy Wells it is obvious either he works for the private sector,he is unaware of policies that exist pertaining to reemployed annuitants and/or he never read the Federal Employees Almanac. If he were to read the Under Secretary of Defense Memorandum of 18 March 2004 he would see that reemployed annuitants work at the will of the hiring authority not at the "whim" of management. No Mr. Wells, this is US Department of Defense policy not the private sector. Federal Civil Service workers have safeguards against managers who like to pull puppet strings and abuse those who are employed under them. Not so with a reemployed annuitant. That was my point. One would think that if they are reemployed by the Federal Government they would be protected under the same laws and policies as a regular civil servant. But a reemployed annuitant is not. Secondly a reemployed annuitant has a choice whether to have health and life insurance benefits taken out of his/her annuity or... do a conversion and have health and life insurance benefits taken out of their salary. If you take life insurance out of your salary instead of your annuity, you'll be able to obtain a higher amount of life insurance. Please refer to the Federal Employees Almanac. Thirdly, reemployed annuitants shouldn't be limited to "PART TIME". The retired military officer who opts to retire today and return to his/her same job as a civilian isn't. Read policy and booklets pertaining to these things before you comment please.

  Reemployed Annuitant Posted June 3, 2008 10:02 AM
• 51601
  

  Its about time this was enacted. It is already in place for the military coming back into civilian service. And it is true, you can go with a contractor and not have the salary offset. I could never figure out why a re-employed annuitant would come back after retirement with no additonal money. And as far as benefits go under this provision, the retiree already has them and doesn't need the regular benefits. If you actually give it some thought, its cheaper for the government to hire an annuitant - benefits are already covered through the retirment system. If you were to hire a new employee, you'd pay benefits in addition to salary. I did notice some complaints about "working at the whim of management". Do you think that if you worked for a contractor you wouldn't be doing so at the whim of management? As with anything, there is room for abuse. Agencies must be fiscally responsible and plan their HR resources so that there is a succession plan. Hiring an annuitant is not a succession plan, but can be a viable piece of one under the right conditions. This is a step in the right direction.

  Roy Wells Posted June 2, 2008 9:33 AM
• 51482
  

  I've read many of your cooments and I believe many of you, especially in DoD, need to read the policy pertaining to reemploying annuitants. Here are some excerpts from that policy: This new legislation provides the Department with the ability to attract and retain talented men and women with the expertise and corporate knowledge to fill critical positions or to temporarily mentor the next generation of civil servants. This critical hiring flexibility will help address the challenges of "retirement driven talent drain" as our current generation of dedicated civil servantsb ecomee ligible to retire. Reemployment of Annuitants Guidance and Procedures: Section 9902(j) of Title 5 gives the SECDEF the authority to hire and set the salary of newly appointed annuitants... without a reduction in pay or annuity. As a result, the salary of the annuitant is not offset by the amount of the annuity received. DOESN'T THIS SOUND FANTASTIC? Please read on. Here are the "CATCH 22s". (1) An annuitant hired under this policy serves at the will of the hiring authority. This means that for any reason whatsoever a reemployed annuitant can be let go i.e. hired one day and fired the next. An annutitant has no union representation and in essence is a "Puppet on a string". (2) The provisions of the Priority Placement Program apply. This means that at any time an annuitant can be replaced by anyone who enters into the PPP who is equally qualified for your position. Think twice because it isn't alright. The policy is also open to good old boy mentality and Cronyism by management. So I hope Ms. Norton and the GAO take a hard look at the policy and perhaps force some changes to it.

  Reemployed Annuitant Posted May 29, 2008 2:27 PM
• 51424
  

  I am a reemployed annuitant under the current DOD policy dated 18 April 2004 whereby I could retain my full retirement pay and have a full salary. However, there is a catch to all this. Although the "carrot" of having a full salary and retaining ones full annuity sounds great, this current policy has a few oxymorons in that (1) I work at the will of the hiring authority, (2) I can be replaced at any time by someone registering on the Priority Placement Program (PPP)list, (3) I have no union representation, and (4) if reassigned Permanent Change of Station (PCS) or Management Directed Relocation (MDR) funding is not available. Yet the policy was written to address the challenges of "retirement driven talent drain" as our current generation of dedicated civil servants become eligible to retire. The oxymoron is that you could be hired today and let go or replaced tomorrow. So what good is the policy? What is not right is that retired military can retain their full retainer and get a full time full salary civil service job with no "catch 22s" over their heads. So why would any retired annuitant want to come back into the workforce under these current conditions? I did because I didn't read the fine print. Had I known back then what I know now I wouldn't have. I did it out of neccessity.

  W. Bidlack Posted May 28, 2008 3:58 PM
• 51180
  

  This is done widely in industry - an employee has worked full time for many years and qualifies for whatever retirement benefits, and then comes back as a "consultant". My friends in the nuclear power industry do it and so does everybody else seem to. Sure, there is cronyism but generally they qualified for their pension and could be sitting on the beach, and are actually earning the pay they get now.

  Some of you are talking like people will step into retirement and another permanent full time job, but the proposal has clear restrictions. Maybe they should be more stringent, because it is unfortunate when a "retiree" causes someone else to miss out on a job or promotion. But - in my small office, two of us out of 7 are retiring close together and the office would benefit by hiring someone for just 3 or 4 months until our replacements can be trained. In an ideal world, the replacements would be ready when we go, but it doesn't work that way. With one of the 5 remaining devoting lots of time to mentoring the two trainees, that leaves 4 people doing work that management thinks needs 7.

  Sometimes offices have a sick employee, employees away on detail, or other unexpected absences or heavy workloads. These are temporary and do not merit hiring more permanent employees. Industry and state and local governments just bring back former employees for a short time. Seems reasonable to me!

  another soon to be retired Posted May 22, 2008 10:57 PM
• 51179
  

  Michael J.: Besides doubling the salary, the military-turned-civilian come complete with 5-10 point vet preference to guarantee them any civil service job in the future, blocking upward mobility for the career civil servant. Those hurt the most by this practice are women, most of whom have no prior military experience and can't compete for promotional opportunities regardless of educational or experience level. Looks like a class-action discrimination case to me.

  engineer Posted May 22, 2008 10:34 PM
• 51173
  

  This doesn't have to be so ridiculously complicated. Instead of having individuals retire, then apply to be re-employed, then have a manager request a waiver, then keep track of their annual hourly ceilings, etc., etc., why not just amend the retention allowance rules? Create a provision that allows retention to be paid to retirement-eligible people in mission-critical or shortage category occupations, then audit the hell out of its usage to guard against abuse. Through careful analysis, you could figure out a retention allowance percentage at which it's more advantageous for someone to stay on (with full benefits, accruing additional service time, etc.) than to retire. Then eliminate rehiring of annuitants entirely. This ain't exactly rocket science... But then again, it's probably too much to expect OPM to come up with a simple, common-sense solution to anything.

  Skepticus Posted May 22, 2008 5:05 PM
• 51165
  

  I have over 40 years with my agency, and am the "historical repository" in my component. Additionally, I am in a one-of-a-kind position with unique responsibilities. I have been trying to train a successor for more than year but the others in the unit have other responsibilites that often taken them out of the office and they are unable to see a project through. Management is unable to fill my position while I am still in it. If I were able to retire and return on a part time basis this would benefit both my agency and myself.

  Kat Posted May 22, 2008 2:17 PM
• 51159
  

  I see room for abuse of this move, because some emploiees that were not able to adavince in there job would retire and then come back as a means of increaseing there income. It would be better to offer somthing to keep them from retireing in the first place.

  Jack Allison Posted May 22, 2008 2:04 PM
• 51150
  

  Touche' Michael J. Smith. I currently have the CMC and Admin Chief betting on who will get my function when I retire. We use to call this a "conflict of interest" when military retired and then came back to the same department or same "identical" function they previously held. That's what we use to call "double dipping". Then, they would retire from the government and go to work for a contractor (triple dipping), back into the same prior function.

  The waiver intention, doesn't provide for benefits. The individual's should only be working part-time. Therefore, only assisting when the time arises. If the waiver is abused, then manager's/organizations should be called on the carpet for their abuse of policy! Thus, dismissal actions "should" be applied to.

  CATZ Posted May 22, 2008 12:27 PM
• 51143
  

  Working part-time makes perfect sense for retaining those personnel at retirement age and with health or energy issues precluding full-time work. They could fill a big void for a few more years.

  PMS Posted May 22, 2008 11:39 AM
• 51140
  

  I believe the program is a good idea, but it can be abused as one writer pointed out. Within the Border Patrol (now part of DHS/CBP) "ex-managers and ex-supervisors" are hiring "ex-managers and ex-supervisors", their friends, for work that is, in many cases, well below their grade level. Former "rank and file" employees find it difficult to become "rehired annuitants"

  John Posted May 22, 2008 11:22 AM
• 51132
  

  I see this as a win-win if enacted properly. A rehired annuitant should not need health care, life insurance, etc., as that's covered with their retirement. Social security would be the only "benefit" the government would have to contribute to, which would result in a huge net savings to the agency when bringing in a retired person on occasion to share corporate knowledge and expertise.

  Soon to be retired Posted May 22, 2008 10:41 AM
• 51130
  

  Its hard for me to believe that any CS skill is difficult to fill. I could imaging MD's or Dentists, but other than that if you have a high school diploma your good to go.

  Dan ketter Posted May 22, 2008 10:31 AM
• 51129
  

  It is difficult to avoid the scarcity dynamics embedded in this discusssion. The scarcity model always considers a benefit to one person as a loss to soomeone else. A larger perspective is required. A retiree who is eligible for retirement benefits will step away when conditions are warranted. Will the federal system be better off paying the benefits and losing the experience forever? Retention at some part-time emeritus level is something that might be very beneficial. But this should never be a right of retirement. Rather it shoudl be an honorarium bestowed at managment's discretion.

  Paul Posted May 22, 2008 10:30 AM
• 51128
  

  "..massive loss of skills and knowledge withing the next decade.." It is time to start mentoring, hire fresh blood and get new young people. It can be done in next two+ years. Stop feeding taxpeyer money to the retirees. We need change in gov and this is a perfect opportunity

  fed on verge of retirement Posted May 22, 2008 10:26 AM
• 51118
  

  Hiring back retired Federal employees is a win win for all. Retirees provide continued expertise and historical knowledge as employees are hired to take their place; and the dollars saved hiring a retiree directly, and not hiring the same person back under a contractor, could have a savings of at least 50% or more per fiscal year.

  Donna Posted May 22, 2008 9:06 AM
• 51108
  

  Don't do it. This is simply a method to double the salaries of friends. It is already happening under the limited authority that currently exists. If Pandoa's box is opened, everone will retire at first opportunity only to be re-employed at double the salary at which time they can coast through remaining years...you'd be a fool not too.

  A colleague who stated he could not financially afford to retire submitted a request saying he was going to retire to see if the organization would approve hiring him back at full retirement and full salary and benefits. If they are dumb enough to do it, he'd take the money and laugh all the way to the bank. And guess what, they were dumb enough. And now the taxpayers are paying approximately $170,000 for a position that should be paid half that much. When the one-year limitation is reached, they likely hire him as a contractor to continue the act. Pass H.R. 3579 and the fleecing of America will go full throttle. Start saving you money because your taxes will be increasing to pay double salaries to Civil servants in unscrupulous organization.

  Dan Posted May 22, 2008 7:54 AM
• 51107
  

  I'm really confused due to extremely different,conflicting views on this subject. One is the external view and the other is an internal reality check. On one side, numerous articles point to the downside of the upcoming retirement of senior, experienced personnel and attempts to keep them and/or re-employee them. However, the flip side of this is that agencies such as the IRS are offering buy-outs and discontinued service in an effort to rid themselves of these "soon-to-be retirement eligible employees" in an effort to cut payroll and hire contractor personnel.

  Senior employees being pushed out the door Posted May 22, 2008 7:48 AM
• 51093
  

  It's obvious the policy makers are not taking in account that their are individuals that were forced to retire early as a result of base closures and need the salary offset so when they get re-hired they can get their retirement re-determined after five years to erase the age penalty (salary reduction for every year below 55). I know of many individuals that were forced to take the early retirement in their forties that would not accept a Gov position because they would not get the salary offset. I believe DOD has a policy that any re-hired retiree would not be allowed to add additional time to their civil service career. If this decision gets approved it would benefit individuals that retired without the early age penalty while penalizing those that accepted early age retirement to to base closures and Rif's.

  Dana Ulanoff Posted May 21, 2008 11:52 PM
• 51083
  

  If Del. Elenor Holmes Norton wants to look at abuse, or better yet stop the continuing torrent of blatant abuse where agencies hire staff at full salary those that are already earning a US taxpayer funded retirement annuity, then she ought to immediately ask the GAO to research DOD's ocean of hiring recently retired senior members of the military into civilan positions. More times than not DOD hiring 'managers' cobble together surmised external recruitments for their fellow uniformed administrative support function office buddies who are soon scheduled to retire from active duty. These administrative support staff are then so-called 'converted' via these de facto sham external recruitments into a high-paying civilian positions many times in the same office and literally the very same chair they occupied while on active duty. And in doing so, they almost double their US taxpayer furnishd income in one feel swoop. At one point in time not too long ago, these recent retirees would have had their taxpayer furnished retirement annuities adjusted. But not anymore. If someone perceives that self-financial driven motivations are not fully in play here, then they still have some swap land in Flordia that may find enticing as well. Now this present feeding frenzy at the public troth at is worthy of Del Holmes Norton's attention.

  Michael J. Smith, M.P.A. Posted May 21, 2008 5:10 PM